KV Reddy was the most successful film director of South India at that time.

It was 1949. Vauhini Productions had already made 6 movies-Vandemataram, Sumangali, Devatha, Bhakta Potana, Swarga Seema and Yogi Vemana, the last of which was not commercially successful. This is when KV Reddy decided to make a Janapadam, which were commercially viable, and a genre Vauhini did not touch till then. BN Reddy was busy with the construction of Vauhini Studios, so KV decided to wield the megaphone again after Yogi Vemana.

The in-house writer, Samudrala Raghavacharya, was busy with other movies. So KV choose Pingali Nagendra Rao who worked as a manager/writer of Indian Dramatic Company run by DV Subba Rao. He wrote the dialogues of Bhale Pelli in 1941, which did not fare well. Then he wrote a play called Vindya Rani, which was made into a movie eventually. He himself worked on the script in 1949. Through a common friend, KV and Pingali met and KV discussed his idea. The idea was to make a movie with Shakespearean characters of King Lear and his three daughters and the take the central theme of King Lear. The dialogues and the lyrics were written by Pingali and the screenplay by KV Reddy and Kamalakara Kameswara Rao.

The synopsis of Gunasundari Katha is this: King Ugrasena of Dhara Nagaram has 3 daughters-Rupasundari, Hemasundari and Gunasundari. Rupa and Hema are married to their cousins, Haramati and Kalamati respectively. Guna comments one day in a discussion that the husband is the most important entity for a girl. Her angered father, the King, then marries Guna off to a blind, limp, mute and deaf pauper, Daivadeenam.

When it is discovered that Daivadeenam is in fact a prince under a curse, Guna and Daiva are banished from the Kingdom. They live far away in a small hut, when news that the King is fatally ill reaches them. Only a precious gem, the Mahendra Mani, can save him. So the three sons-in-law set out to find the gem and Daiva finds it. Haramati and Kalamati steal it from him and the King is cured. Another curse hits Daivadeenam, who now turns into a bear. Pleased with Gunasundari's devotion, Lord Shiva and Parvati bless Daivadeenam and he becomes normal once again. The King, understanding the truth finally, makes Daiva the King.

For the title role, they wanted established actors like Anjali Devi and S. Varalaxmi. Pingali suggested Senior Sriranjani's sister, junior Sriranjani, who worked as a child artiste and later did some small roles. KV was not convinced but later choose her because after three futile months of searching for a lead, they failed to find one. Kasturi Siva Rao plays Daivadeenam, the first and last choice for the difficult role of a man with so many physical challenges.

Shanta Kumari plays Rupasundari and Malathi plays Hemasundari. The roles are brief, but the two actors were enthusiastic to work for Vauhini and KV Reddy all the same. Malathi later worked as a lead in Patala Bhairavi. Relangi and G. Subba Rao play the roles of Kalamati and Haramati. Relangi's association with KV Reddy started from this movie. Vijaya Nirmala was a child artiste then, and played the role of Gunasundari as a child.

Kamalakara Kameswara Rao directed the Tamil version of the film.

Nagaiah's assistant for Swarga Seema and Yogi Vemana, Ogirala Ramachandra Rao composed the music. Most of the actors rendered their own songs, as playback wasn't totally established then. But Leela sang for Sriranjani. The songs were a hit with the public, especially 'Sri Tulasi Priya Tulasi'. Nagaiah either acted or composed movies for the first six Vauhini movies, but none after that.

Vauhini Studios was under construction, but they shot there anyway. They finished shooting at Thad forest near Chennai for all the forest scenes. From this movie onwards, all of KV Reddy's movies have a bear in it, somewhere or the other. KV also started the trend of showing a snake and mongoose fight to depict something. The camerawork and the graphics by Bardey were highly appreciated.

The audiences found the movie both entertaining and sentimental in parts. It was successful, and some theatres even had four shows running. The late-night show would begin at midnight and end at dawn, so viewers would be given a neem twig along with the ticket to brush their teeth at dawn. Remember that was 1949!

After this movie, Pingali Nagendra Rao became the in-house writer for KV and BN Reddy's Vijaya Productions. He wrote classics like Maya Bazar and Patala Bhairavi, both directed by KV Reddy. Vijaya Productions remade Gunasundari Katha in Tamil with the same name, six years after it was made in Telugu. This was directed by Kamalakara Kameswara Rao and did well in Tamil as it did in Telugu.